chapter  5
10 Pages

Two-part pricing

This chapter looks at occasions when an organization might depart from profit-maximizing pricing strategies in order to further the cultural or social mission of the organization. It considers two reasons for mission-based pricing techniques. The first reason stems from an observation to make when it comes to writings on nonprofit and public sector pricing: that the analysis tends to focus on how such organizations would depart from profit-maximizing pricing, without ever explaining how profit-maximizing pricing actually works. The second reason is that it is not clear that a nonprofit or public sector arts organization would always want to depart from the strategic pricing techniques. Nonprofit and public sector arts organizations have complex goals. While a commercial firm has a clear motive of profit, nonprofits and public sector arts organizations can have multiple aspects to their organizational mission. The chapter summarizes mission-based arts institutions need not depart from the strategic pricing methods that have been discussed.